Shopping returns grow – with environmental as well as financial impact

An estimated $135bn worth of goods will be returned in the US between Thanksgiving and the end of January, a 12.5% increase from the same period last year. 

And rather than ending up back on retailers’ shelves, a big chunk of that will go to landfill, according to Optoro, a reverse logistics tech company. 

Why it matters

While Optoro’s figures refer to the US, it’s a problem for retailers everywhere. An easy – and free – returns process can be an important factor in ensuring a positive experience that helps retain customers and drive growth. But as returns grow, new questions have to be addressed. 

Do the financial costs involved justify the effort? And as more businesses proclaim their sustainability efforts when it comes to making products, how do they square that with the environmental impact of handling all those returns, whether that’s in terms of transport emissions or, in the case of fashion items in particular, the extra landfill being created.

By the numbers 

• Total US returns in 2021 accounted for more than $761bn in merchandise.
• Online returns resulted in 14% more waste than in-store in 2021.
• Returned inventory creates some 44 million tons of landfill waste each year, and emits more than 27 million tons of carbon dioxide.
• Apparel has the second-highest return rate at 12.2%; but auto parts are highest at 19.4%, according to the National Retail Federation.

Key quote

“You’re losing a ton of value in markdowns that occur and goods that don’t get back to stock, which is a lot of cheaper goods and larger items where it doesn’t make economical sense to fully process the goods. A lot of those goods end up just going straight to landfills” – Tobin Moore, CEO and co-founder of Optoro, talking to Retail Brew.

What’s the solution?

The obvious answer is to simply reduce the number of returns by making the purchase process better. For fashion brands, that increasingly involves the use of virtual try-on technology so consumers can get the fit right first time rather than buying several sizes to try on at home before sending back those that don’t fit.

Optoro also points out that a more sophisticated returns process can avoid sending products to landfill, instead redirecting them to resale or wholesale alternatives, or donating them to charity. 

Sourced from Retail Brew, Optoro